Research, market insights, press releases and documents for professional investors — from C8 Technologies and our global index and research partners.
Day Hagan/Ned Davis Research Smart Sector® with Catastrophic Stop strategy, model and allocations update.
Now a week out from the Fed making it clear that the squeeze of lower growth isn’t worth the juice of bringing inflation back to (not toward, Jerry!) 2%, Mohamed El-Erian summed up the state of play nicely in a recent article for the FT. The Queens’ College president noted that, “It is not often that you see a reputable central bank revise up its inflation and growth projections and yet strengthen a dovish tilt to its policy stance. Yet that is what happened in Washington last week when the Federal Reserve raised those projections up a notch and yet delivered two consequential signals – a willingness to tolerate higher inflation for longer and an openness to slow the ongoing reduction in its balance sheet.”
As the saying goes, “needs must when the devil drives”. We have no problem understanding the Fed’s decision to announce (at 7pm last night) that the details of the BTFP program needed to be altered. The problem was the overly juicy arbitrage, whereby banks could use the BTFP window to flip cash from the Fed into the RRP and pocket the not-insubstantial difference. We were impressed by the chutzpah involved in arbitraging two Fed facilities!
C8's CEO, Mattias Eriksson, proposes an alternative to this traditional equity-bond mix that results in better and more robust investment outcomes. It is achieved through a combination of adding uncorrelated alternative constituents and using modern portfolio construction methods.
The C8 Bulletin is back after a summer break, and we are delighted to announce that Macro Intelligence 2 Partners have added their Macro Alpha index to C8 Studio. The Macro Alpha strategy is deeply rooted in MI2's macroeconomic insights. These directional strategies encompass a broad range of asset classes. The strategy aims to optimize risk-adjusted returns by dynamically-adjusting portfolios based on changing macroeconomic conditions. Taking three of our Global Macro contributers (including MI2), combining using our proprietary Tactical Asset Allocation, would have produced a 24% annual gain with 11% volatility and, notably, a 40% negative correlation to the S&P over the past two years.
One of the big advantages of direct indexing with C8 is the ability to efficiently combine investment approaches on our platform, C8 Studio. A perfect example is the recent launch of a new index by one of our providers, IVI Capital.
The first quarter of 2023 has been notable for its skittish financial markets. First, there was optimism that this year would prove calmer than 2022, followed by renewed concern about inflation and the impact of bond holdings in the US banking system. This culminated in the forced takeover of Credit Suisse at the weekend. Traditional trend-following strategies performed strongly in 2022, but these rapid shifts in sentiment have proved more difficult to navigate. The SocGen CTA index is down 6% year-to-date, and down nearly 10% in the past week. Here is the good news! The C8 Global Active Futures index avoided this sell-off and remains up on the year. Why the difference? C8's proprietary allocation process selects from a wide range of trend and counter-trend strategies, and is responsive to volatility levels, so adapts more readily to changing market environments.
Over the month since our C8 Weekly Bulletin highlighted early signs of an opening up of the Chinese economy, the liberalisation steps have gathered new momentum. Against this backdrop, the timing may be propitious for Cirdan Capital's launch today of the C8 China Futures Access certificate.
C8, the pioneering fintech platform that offers investors the ability to use direct indexing across all liquid asset classes and investment styles, announces that the US Patent Office has issued a patent on C8’s ground-breaking end-to-end platforms, C8 Studio and C8 Wealth, for Direct Indexing.
Central banks have had to act aggressively to contain inflation expectations - leading to an unwinding of excess global liquidity and divergent responses across asset classes. A return to "normal" financial markets, with less policy support for asset prices and higher market volatility. In this context, there is also new investor interest in trend-following strategies that exploit diverging market dynamics. C8 Studio contains both high quality trend-following indices and innovative combination technology.
With equity and bond markets having moved in tandem for the past few years, this week's Bulletin focuses on the potential to add uncorrelated returns to an equity/bond portfolio.
Summary: Appendix A (FIA Exchange Ranking Data) Appendix B (FIA Contract Ranking Data China Futures Market Growth & Local Exchanges Increasing Openness & Regulatory Framework C8 Program, Sub-Components & Historical Performance Competitors & Competitive Advantages Persistent Barriers to Entry & Regulatory Hurdles
C8 Global CTA Program- Opportunity Overview: C8 Global CTA Program Background: C8 Global CTA Program (Index) Program Methodology Constituents Historical Performance Diversification & Benefits to the Investor Implementation Methods
This week's Bulletin is being guest edited by one of our newest index providers, IVI Capital, a global macro hedge fund. Their index is a daily, futures-only strategy. C8 Studio shows the index up 23.5% so far this year.
Welcome to our first issue of the C8 Weekly Bulletin. With many years of market experience, we at C8 see real benefits from having a concise overview of key economic and policy developments, whatever the specific investment approach. We are happy to share this overview with our clients and partners, and, where appropriate, highlight indices on C8 Studio which resonate with the current market environment.
In August, as the inflation viewpoint becomes established, the certificate was able to capture these moves, rebounding sharply to rise by 4.6% in the month.
Please find below monthly updates for the following C8-driven products: C8 Corporate Bond Monthly Update, C8 Active World ESG Index, C8 Multi Asset Global Opportunities Certificate, C8 China Futures Access TRS, C8/ Greenblue Good Governance US Equity L/S Certificate
C8, the pioneering fintech platform that offers investors the ability to use direct indexing across all liquid asset classes and investment styles, today announces that Cirdan Capital has issued an Actively Managed Certificate (AMC), C8 Multi-Asset Global Opportunities (GMAO)
This week we take a quick look at upcoming ECB meeting and what we are seeing in global markets. Some issues are building.
This week we take a look at the employment numbers for the US and some warning signs for EM.
